PH SHARES WEEKLY OUTLOOK

Boost seen from Q3 earnings results

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A SPATE of earnings results starting this week could lead to “reduced volatility” for Philippine stocks, analysts said.

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Jason Escartin, investment analyst at F. Yap Securities Inc., claimed “more good things to come” for the Philippine Stock Exchange index (PSEi) in the next few days.

“Since 24 August, the PSEi has gone above 7,200, breaching target resistance for the third testing last 23 October. The PSEi hit its upper 30-day Bollinger Band, which has narrowed considerably, indicating reduced volatility. Set against a strong macro environment, upsides are to be seen especially for fourth corporate earnings,” Escartin said.

Bollinger Bands are technical indicators that measure volatility.

BPI Asset Management, on the other hand, was more cautious, saying in a weekly market outlook that the PSEi could “stay on the sidelines awaiting for significant data releases such as the US third quarter gross domestic product figure.”

RCBC Securities, Inc. research analyst Anton G. Alfonso, for his part, said third quarter results could be the stimulus that would move the market past global volatility, fears of a US interest rate hike and a slowing Chinese economy.

“With the third quarter 2015 earnings to be announced starting next week, the market may have found the catalyst it needs,” Alfonso said.

AB Capital Securities said that with the PSEi having breached the 7,200 level, the next short term resistance target would be 7,800.

“Bullish sentiments from further EU stimulus pushed the PSEi higher on Friday to finally break above the resistance at 7,200. The breakout from this … implies a possible short-term target of 7,800. Immediate resistance is at 7,400 while immediate support can be found at 7,200,” AB Capital said.

On Friday, the benchmark stock exchange index gained 1.67 percent or 118.60 points to close at 7,236.38, while the All Shares index also increased by 1.38 percent or 56.55 points to 4,160.64.

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